Australian EFTPOS provider Smartpay Holdings (ASX: SMP) has announced it will sell its New Zealand business and assets to US payment terminal business Verifone Inc for NZ$70 million.
The proceeds of the sale will be used primarily to capitalise Smartpay’s Australian business for accelerated growth.
Funds will also be put towards the settlement of all banking facilities and the provision of a cash distribution to shareholders.
Smartpay said the distribution will be finalised closer to completion of the sale and will be determined according to the company’s capital structure and funding requirements for its Australian business at the time.
It expects the distribution to be around $0.18 cents per share.
Managing director Bradley Gerdis said the sale acknowledges the New Zealand arm of the business as a leading provider of payment solutions to the local market.
“This transaction is a significant achievement as it recognises the substantial value we have created in our New Zealand business,” he said.
“It provides a substantial value outcome for our shareholders in what is a mature part of our operation.”
Mr Gerdis said Smartpay would retain its Australian business and assets including Retail Radio, Alipay and WeChat Pay.
The sale announcement comes after the company reported a revenue of $13.4 million from continuing operations during the six months to September, representing a 31.7% increase on the previous period.
Mr Gerdis said the strong increase was a result of the continued growth in its Australian terminal and acquiring business over the period.
“This sale will allow us to go forward applying all our resources and focus to [this] fast growing [part of our] business,” he said.
The company’s Australian acquiring terminal fleet stands at 4000 self-acquired terminals – up from approximately 1500 in November last year and 2200 in March.
The terminals process over $1 billion of combined EFTPOS transactions per year.